PV’s levelized cost drops to 11.5 cents per kWh with incentives

Posted on January 25, 2012. Filed under: Energy Policy, General, Solar | Tags: , |

An analysis by Don Wichert, Director, Renewable Energy Services,
Wisconsin Energy Conservation Corporation (WECC):

My recent (simplified) levelized cost analysis for commercial PV, at $5,252 a kW installed in WI, over 25 years and with a 5% loan (no shading, no maintenance, no output degradation), is 13.8 cents per kWh as shown on the slide below. This includes a 56% reduction in the installed price due to the ITC and depreciation. With the previously available $600 a kW Focus base incentive, the levelized cost drops to 11.5 cents per kWh.

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Renewable energy summit leader lauds Xcel’s new incentives

Posted on January 2, 2012. Filed under: Energy Policy, Renewable energy - generally | Tags: , |

For immediate release

More information
Michael Vickerman

The economics of small-scale renewable energy in western Wisconsin will brighten in January when Xcel Energy’s new rates take effect for homeowners and businesses. In a recent rate case decision, the Public Service Commission (PSC) approved Xcel’s proposal to strengthen its support for renewable energy in its territory through higher payments for the energy produced by solar, wind, and biogas installations.

“Xcel’s energy initiative affirms the value of voluntary utility actions that provide needed incentives that support the continued growth of Wisconsin’s renewable energy economy,” said Michael Vickerman, RENEW Wisconsin’s Executive Director.

RENEW and other industry leaders will host an energy policy summit in January to formulate strategies for advancing in-state development of renewable energy through public policies and private initiatives. More information about the RENEW Energy Policy Summit can be found at http://www.renewwisconsin.org

In the same decision, the PSC strengthened Xcel’s net metering offering. Starting in January, the ceiling on qualifying systems rises from 20 kilowatts to 100 kilowatts in size, which will enable larger solar and wind systems to receive full retail value for energy sold to the utility up to the customer’s annual consumption.

“Net metering policy is a critically important facet of the renewable energy marketplace. At our January summit, we will tackle the thorny questions of how to strengthen this and other policies for assisting Wisconsin electricity customers who wish to capture the benefits of on-site renewable energy production.” Vickerman said.

— END –

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Rep. Barca: Wind energy holds the key to rapid Wisconsin job growth

Posted on December 5, 2011. Filed under: Economic development, Energy Policy, Jobs, Wind | Tags: , , , |

A news release issued by State Rep. Peter Barca (D-Kenosha):

Last year Wisconsin made great progress on wind energy and there was bipartisan enthusiasm for advancements in this cutting-edge industry. A wind energy bill was approved last session with a two-thirds majority in both houses – including the leaders of both parties. Organizations such as the Wisconsin Energy Business Association praised Wisconsin’s potential for success in wind energy.

We fully expected the bill would be implemented early this year and Wisconsin would begin catching up with its neighbors. Currently Iowa gets nearly 20 percent of its energy from wind, while Wisconsin generates a mere two percent of its energy supply from this renewable, local source. Minnesota and Illinois each currently produce four times as much. Other states in our region are benefiting from cheap and clean energy, huge private investments, and countless high-tech energy and construction jobs.

Wind energy creates jobs. And Wisconsin needs jobs.

When Gov. Walker took office, it was estimated that Wisconsin’s wind industry contributed between 2,000 and 3,000 direct and indirect jobs. There are 171 wind-power supply chain businesses in Wisconsin. And we are home to more than 20 manufacturing facilities that make components for the wind industry. This represents tens of millions of investment in wind-specific manufacturing infrastructure and equipment.

Inexplicably, Gov. Walker and legislative Republicans have used the rules process to cripple wind energy production in Wisconsin, leading to the cancelation of several major wind projects, which RENEW Wisconsin estimated would have produced a thousand jobs and $1.2 billion in investment.

This will also cause Wisconsin to fall further behind our neighboring states.

Democrats pushed to allow the wind siting rules to go into effect – giving more certainty to developers and allowing major wind energy projects to go forward and would have certainly created hundreds, or possibly thousands, of jobs. But Republicans refused, despite the prior bipartisan agreement last session on this issue. (more…)

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Solar energy makes gains, but policy puts future in question

Posted on December 1, 2011. Filed under: Energy Finance, Energy Policy, Solar | Tags: , , |

From an article by in the La Crosse Tribune:

When the sun shines, Al Schultz makes money. Specifically, the 32 photovoltaic panels on his roof turn the sun’s rays into electricity that powers his home in Ebner Coulee. If he doesn’t need the power, he sells it to Xcel Energy.

“There is a certain peace of mind,” said the self-employed contractor. “It’s kind of a nice thought to think all your power is paid for.”

Schultz is one of a small but growing number of area homeowners who’ve taken advantage of new, cheaper solar technology, which coupled with state and federal incentives have brought residential solar electric systems within reach of more regular folks looking to lessen their dependence on fossil fuels, lower their utility bills and even make some money.

But changes on the horizon have cast a shadow over the solar industry’s future in Wisconsin. . . .

“Right now it’s out of reach for 90 percent of the home-owning population,” said Michael Vickerman, executive director of RENEW Wisconsin, a nonprofit that promotes economically and environmentally sustainable energy in Wisconsin. . . .

Money from Focus on Energy is still available this year, but rebates will be frozen in January as FOE implements new formulas used to evaluate cost effectiveness and rebalances its portfolio of energy savings and renewables.

Program administrator William Haas said next year’s renewable incentives won’t be decided until early spring.

Solar advocates like Vickerman say the energy policy hierarchy, which values efficiency – use reduction – over renewables in terms of cost effectiveness, is misguided.

“However much efficiency is injected, it doesn’t have any change in the resource mix,” he said. “Diversifying resource mix has value.”

Solar panels may reduce dependence on fossil fuels, but dollar for dollar, Haas said, high-efficiency lighting delivers better savings.

Dearing points out that his customers have already weatherized and bought high-efficiency appliances.

“Our customers call us after they’ve done the low-hanging fruit,” he said. “We’re expensive. This is big dollar stuff. This is the future.”

Vickerman says the future of the solar industry depends on policy.

“If we proceed without any policy changes there won’t be much happening,” he said. “You’ll see a number of solar installers go out of business.”

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Twenty-four governors, not including Walker, ask Obama to extend tax credits for wind project investments

Posted on November 18, 2011. Filed under: Economic development, Energy Policy, Jobs, Wind | Tags: , , , |

From a news release on the Web site of the American Wind Energy Association:

Iowa, Aug. 24—A coalition of 24 governors from both major parties and each region of the country has asked the administration to take a series of steps to provide a more favorable business climate for the development of wind energy, starting with a seven-year extension of the Production Tax Credit (PTC) and the Investment Tax Credit (ITC) to provide stable, low tax rates for wind-generated electricity.

A letter from the governors, sent last month to the White House, has since been made public by the Governors Wind Energy Coalition. Signed by coalition chair Gov. Lincoln Chafee (I-RI), and vice chair Gov. Terry Branstad (R-IA), the letter says:

“Although tax credits for wind energy have long enjoyed bipartisan support, they are scheduled to expire next year. Wind-related manufacturing will slow if the credits are not extended, and some of the tax credits’ benefit will be lost if Congress pursues a last-minute extension. It is important to have consistency in policy to support the continued development of wind manufacturing in the United States. Extending the production tax credit and the investment tax credit, without a gap, is critical to the health of wind manufacturing in our nation. The wind manufacturing industry in the U.S. would benefit even greater if the extension of these credits would be for at least seven years.”

“Governors have always focused on jobs and economic development as their main responsibility. Now that Washington is following suit, it helps for these Governors to tell Washington what has been putting people to work in their states,” said AWEA CEO Denise Bode. “It is also helpful for them to support the removal of roadblocks that can occur in administrative agencies, so that deployment objectives are not unintentionally thwarted.”

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RENEW Opposes Bill to Weaken State Renewable Energy Standard

Posted on September 8, 2011. Filed under: Carbon, Energy independence, General | Tags: , , |

At a September 6  hearing of the Assembly Energy and Utilities Committee,  Michael Vickerman testifies against AB146, a bill that would extend into perpetuity the shelf life of an unused renewable energy credit. Vickerman’s testimony explains how this seemingly innocuous change to Wisconsin’s renewable energy standard would allow utilities to put off the day when they would need to add more renewable energy to their resource mix.

Click Here for Testimony

Good morning, my name is Michael Vickerman. I am here to represent RENEW Wisconsin, a nonprofit advocacy and education organization based in Madison. Incorporated in 1991, RENEW acts as a catalyst to advance a sustainable energy future through public policy and private sector initiatives. We have over 300 total members, and more than 100 businesses around the state producing renewable energy or building renewable energy systems. A list of our business members accompanies this testimony

On behalf of our members and the many businesses and individuals who support the continued expansion of Wisconsin’s renewable energy marketplace, RENEW Wisconsin is here to express opposition to AB 146. If passed as is, AB 146 would water down the state’s Renewable Energy Standard by extending the shelf life of an unused renewable energy credit to infinity. As the accompanying graphic shows, no other state in the Upper Midwest allows their utilities’ renewable energy credits to be banked in perpetuity. In the same graphic, one can also see how weak Wisconsin’s renewable energy standard has become in relation to those of neighboring states.

What is the problem here that this so-called “tweak” would solve? Other utilities in the region face stiffer renewable energy supply requirements than the utilities in Wisconsin, yet you don’t see them beseeching special treatment that allows them to bank unused renewable generation for decades. Giving into their request would effectively give utilities a 10-year vacation from actually adding a new renewable energy source to stay in compliance with their Act 141 requirements. All the Wisconsin utilities would need do to remain in compliance would be to fill out some paperwork at the end of the year and buy a new batch of elderly credits out of petty cash. How many jobs will that create? How many dollars in landowner and local government revenues will that generate?

The answer is none.

Another thing that extending the shelf life of unused renewable credits will not do is save ratepayers money. The bill lets the utilities put off the day when they would actually need to achieve a renewable energy content of 10% in real time, well into 2020’s by my calculations. In so doing, the benefits from continued investments in renewable generation, such as technology improvements, capital cost reductions and protection from fossil fuel cost increases, would not be passed along to ratepayers. Meanwhile, the Wisconsin businesses that generate renewable electricity for Wisconsin electricity customers in real-time—and there are many, as this table of biogas installations comprehensively shows– will in all likelihood downscale their presence in Wisconsin and deploy their resources in other states with livelier renewable energy markets. The impact of this bill’s passage will be particularly devastating to the state’s agricultural and food processing industries, because the renewable generation they produce from their wastes will not be needed as an energy source for years to come.

It’s worth repeating that no other state in the Upper Midwest has adopted such relaxed terms for banking renewable energy credits. These states understand that the principal effect of such a change would be to diminish the pace and scale of renewable energy installation activity. They have no desire to put a brake on one of the few economic sectors with the potential for additional growth. But they’re not going to complain if a misguided neighboring state commits this folly.

Let me put this in simple terms: this bill is nothing more than a utility-led effort to drain all the life out of Wisconsin’s renewable energy standard while leaving the law on the books. Under this bill, 2005 Act 141 will effectively become a sham law, devoid of any discernible effect. It will undermine the renewable energy marketplace, which in the last five years has been a source of vitality and confidence for the state’s economy. Once this particular marketplace goes away, there is nothing to stop the state’s energy economy from becoming a lifeless backwater. Is this the vision you have for Wisconsin’s future?

Respectfully submitted,

Michael Vickerman,
Executive Director

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State’s political climate endangers forward-thinking energy policies

Posted on August 2, 2011. Filed under: Energy Policy, Renewable energy - generally | Tags: , , |

From a commentary on Left Business Brain by Tom Breuer:

Prehistoric life forms may have been contributors to our current fossil fuel-based economy, but prehistoric thinking has no place in our modern deliberations about energy policy. That’s why a blog post published last week by RENEW Wisconsin Executive Director Michael Vickerman is so alarming.

In the piece, which appears on RENEW Wisconsin’s blog, Vickerman delineates some of the backward-thinking moves our state leaders have made with regard to renewable energy since the first of this year. They include suspending a rule that established uniform standards for permitting wind energy systems and cutting the budget of Focus on Energy, which supports investments in renewables. In addition, says Vickerman, Focus on Energy has stopped accepting applications for business program incentives that promote the installation of renewable energy systems.

Unfortunately, any time we set the clock back on renewable energy development and investment, we increase the chance that we’ll be sinfully unprepared when the fossil fuel finally hits the fan. Indeed, any energy policy worth its salt must take into account a stark Malthusian reality: A rapidly expanding world population is consuming more and more energy, gobbling up – in a matter of decades – fossil fuels that took millions of years to collect in the earth’s crust. It’s like going to Vegas and blowing your inheritance on a lost weekend, then expecting another inheritance to be deposited in your checking account on Monday. Unfortunately, no more cash is coming, and there’s nothing left to do but scan the classified ads, hoping to snag an interview for a job as Carrot Top’s gofer and personal massage therapist.

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National Study Vindicates Wisconsin’s Clean Energy Policies

Posted on July 18, 2011. Filed under: Economic development, Energy Policy, Jobs, Renewable energy - generally | Tags: , , , |

Immediate release
July 18, 2011

More information
Michael Vickerman
Executive Director

National Study Vindicates Wisconsin’s Clean Energy Policies

Nearly a decade of forward-looking strategies propelled investments in Wisconsin’s clean jobs economy above other Midwest states, according to an economic study issued by The Brookings Institution, a nonpartisan public policy organization in Washington, D.C.

Reviewing data gathered between 2003 and 2010, the Brookings analysis pegged the number of clean economy jobs in the state at 76,858, a net increase of nearly 4,000. Measured as a percentage, Wisconsin’s clean economy accounted for 2.7% of all jobs in the state, compared with 2.5% for Iowa, 2.1% for Minnesota, 1.9 % for both Indiana and Michigan, and 1.8% for Illinois. Overall, Wisconsin ranked 8th among all states and the District of Columbia in the relative size of its clean economy.

The report categorizes clean economy jobs as those in energy efficiency and renewable energy; sustainable forestry products; recycling and reuse; waste management and treatment; organic food and farming; energy efficient appliance and building manufacturing; and more.

“Clearly, Wisconsin’s commitment to clean energy has paid dividends, attracting new businesses and creating high-paying jobs that could have easily gone elsewhere,” said Michael Vickerman, executive director of RENEW Wisconsin, a statewide organization advocating for public policies and private initiatives that advance renewable energy.

These policies and initiatives include the establishment of Focus on Energy, the region’s first ratepayer-funded energy efficiency and renewable energy program, attractive buyback rates offered by utilities for renewable energy, and innovative incentives to encourage customer installation of renewables.

In addition, Wisconsin’s adoption of a 10% renewable energy standard back in 2006 spurred new utility-scale installations built by skilled tradesmen employed by local contractors. During the study period, the number of wind-related jobs in Wisconsin doubled from less than 450 to 900.

As documented in the Brookings report, the wages for these clean economy jobs run higher than the statewide average ($37,931 vs. $35,906).

“Unfortunately, Wisconsin’s clean economy is in danger of losing a good deal of its steam as a result of policy rollbacks and funding cutbacks in the renewable energy arena,” Vickerman said. “The short-sighted attacks we’ve seen in 2011 could throw the state’s clean economy into reverse next year.”

So far this year, the Legislature has reduced funding for Focus on Energy, suspended the statewide rule regulating the permitting of wind turbines, and weakened the state’s renewable energy standard by allowing utilities to count Canadian hydropower toward their requirements.

“On top of that, We Energies, the state’s largest utility, announced that it will discontinue what had been an effective renewable energy initiative,” Vickerman said. “Among other accomplishments, it was instrumental in enabling Helios USA to build a solar-electric manufacturing facility in Milwaukee’s Menomonee River Valley.” The plant now employs 50 workers.


RENEW Wisconsin is an independent, nonprofit 501(c)(3) organization that acts as a catalyst to advance a sustainable energy future through public policy and private sector initiatives. More information on RENEW’s Web site at http://www.renewwisconsin.org.

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Wisconsin’s Widening War on Renewable Energy

Posted on July 11, 2011. Filed under: Economic development, Energy Policy, Jobs, Renewable energy - generally | Tags: , , , |

Dramatic Slowdown in Market Activity Anticipated
By Michael Vickerman
July 11, 2011

What started out as an opening salvo from the Walker Administration to shackle large-scale wind projects has in six months turned into a systematic campaign to dismantle the state policies that support renewable energy development. Joining the executive and legislative branches in pursuing policy rollbacks and/or funding cutbacks against renewables are various utilities and, surprisingly, Focus on Energy, Wisconsin’s ratepayer-funded energy efficiency and renewable programs.

Since January 1st, Wisconsin has seen a series of assaults against utility-scale projects and smaller renewable systems serving both residences and businesses. These include the following actions:

  • The Legislature suspended PSC 128, the statewide rule developed by the Public Service Commission last year in response to a law passed by the Legislature in 2009 ordering the agency to establish uniform standards for permitting wind energy systems. Since the March 1 suspension vote, wind development in Wisconsin has slowed to a standstill.
  • The Legislature adopted SB 81, a bill that RENEW Wisconsin describes as the “Outsource Renewable Energy to Canada Act.” SB 81 allows Wisconsin utilities to meet their renewable energy requirements beginning in 2015 with electricity generated from large hydropower plants in other states and Canada. By allowing Wisconsin utilities to become even more dependent on energy imports than they are today, SB 81 turns Wisconsin’s Renewable Energy Standard on its head. Importing large-scale hydropower exports the very dollars that could have been used to harness Wisconsin’s renewable energy resources.
  • We Energies, the state’s largest electric utility, abruptly decided in May to walk away from an agreement with RENEW to dedicate $60 million over a 10-year period in support of renewable energy development in its territory. The decision came in the sixth year of this program. We Energies plans to reallocate the unspent dollars (totaling about $27 million) to general operations.
  • Green Bay-based Wisconsin Public Service (WPS) instituted in April a new net energy policy designed to discourage new customer-sited renewable energy systems. Until recently WPS had been paying its customers the full retail rate for electricity that flows back on the wires, which is now about 12 cents/kWh. But under the new rate, WPS only pays three cents/kWh for electricity exported to the grid. Moreover, the utility calculates the net each month, which penalizes customers whose loads vary significantly depending on seasonal factors. Right now, the new policy only covers systems installed after March 2011, but WPS has said that it plans to apply that rate to older systems effective January 2013.
  • In its deliberations on the biennial state budget passed in June, the Legislature appended a rider to tie Focus on Energy’s annual budget to a percentage (1.2% of gross utility revenues). This action will mean a cut of $20 million in the program’s 2012 budget relative to this year’s allocation of $120 million. The Focus on Energy program provides grants and cash-back awards supporting customer investments in solar electric, solar thermal systems, small wind, biogas and biomass energy systems.
  • Last, but certainly not least, as of July 1, Focus on Energy stopped accepting applications for business program incentives to help customers install renewable energy systems. These incentives, which average about $7 million per year, had been available since 2002 to businesses, farms, schools, local governments and other nonprofit customers. It is not clear when these incentives will be resumed and in what quantity.
  • This one-two punch of policy rollbacks and funding cutbacks has cast a pall over the state’s renewable energy marketplace. At this year’s Energy Fair in Custer, Wisconsin, the prevailing mood of contractors and exhibitors was one of bewilderment tinged with anger. It is dawning on these companies that their state, which once took pride in its efforts to nurture a thriving renewable energy market, is becoming an inhospitable place to do business. The transformation is occurring with stunning speed; no business is likely to be spared from this abrupt reversal of fortune, which will hit home soon and continue for several months, if not years.


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Energy programs get Walker ax

Posted on March 4, 2011. Filed under: Energy Efficiency, Energy Policy | Tags: , |

From an article by Mike Ivey in The Capital Times:

If you like burning fossil fuels – hey, aren’t those Koch brothers in the pipeline business? – then you’ll love Gov. Walker’s proposed budget.

The 1,345-pager takes a whack at scores of environmental efforts, from nixing the state Office of Energy Independence to actually encouraging state vehicles to use more gasoline.

Seriously, you can’t make this stuff up. And with pump prices marching toward $4 a gallon, you wonder if any thought went into the long-term fiscal impacts.

But here’s the skinny.

Walker wants to eliminate the Office of Energy Independence, which works to reduce the state’s annual energy bill. Launched by Gov. Doyle in 2007, it has 10 staffers and an office at 201 W. Washington Ave.

Since Wisconsin has no coal, natural gas or oil reserves, its citizens send over $20 billion out of state every year to Wyoming, the Gulf of Mexico and the Middle East evil-doers who hate America.

The OEI was designed to work with the biofuels industry, renewable energy markets and alternative energy researchers here at home.

Instead, Walker wants the Department of Administration to develop a “cost-effective, balanced, reliable, and environmentally-responsible energy strategy to promote economic growth.” As in growth for the oil and gas guys?

The state has also been operating under a directive that by 2015 it reduce gasoline use by at least 50 percent from 2006 levels. Walker wants to eliminate the requirement and drop the reduction goal to 20 percent.

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